Last week, Uber CEO Dara Khosrowshahi touted “promising partnership talks” on his Twitter feed, where he posted smiling photos of himself alongside Prime Minister Shinzo Abe and Toyota chief Akio Toyoda.
Japan’s taxi companies have previously seen little reason to innovate until now, shunning the upheaval seen across the industry elsewhere in the world. But foreign and domestic taxi companies have recently begun vying to upgrade the sector with new technology initiatives.
Last week, Uber CEO Dara Khosrowshahi touted “promising partnership talks” on his Twitter feed, where he posted smiling photos of himself alongside Prime Minister Shinzo Abe and Toyota chief Akio Toyoda.
The global ride-hailing giant has had little success so far in penetrating Japan’s taxi market, which is governed by strict regulations.
But with major sporting events — the Rugby World Cup next year and the 2020 Olympics — expected to bring in an unprecedented number of tourists, companies including Uber think the time is right for a taxi revolution.
“We know that the first thing many people do when they arrive in a country is open the Uber app. Our vision is for visitors to Japan to get a taxi via the app, with no language issues,” said Uber spokesman Chris Brummitt.
Other players eyeing a piece of the market include Chinese ride-hailing giant Didi Chuxing and Japanese telecom firm SoftBank, who announced a deal in early February to develop a taxi app in Japan.
Japan’s taxi companies have also announced initiatives, which seek to tackle a decline in rider figures, which fell by a third between 2005 and 2015.
Tokyo’s leading taxi company, Nihon Kotsu recently began testing a ride-hailing app. JapanTaxi, the subsidiary in charge of the project, estimates the app could reduce ride costs by between 15 and 40 percent for customers.
The company has attracted ¥7.5 billion from Toyota for other projects to update the sector including equipping taxis with on-board tablets and AI technology to help better predict customer demand.
Sony is jumping in too, announcing plans to partner with six taxi companies that would receive AI technology for their vehicles, some 10,000 in Tokyo alone.
At Nissan Motor Co., developers are testing “robo-taxis,” driverless cabs that could be particularly tempting for Japan, given its labor shortages. Nissan’s partner Renault hopes it can bring the taxis to market by 2020 — just in time for the Olympics.